Local prices of edible oil have been above the ceiling in recent months as it is sensitive to changes in international markets, given India’s high dependence on imports.
Local prices of edible oil have been above the ceiling in recent months as it is sensitive to changes in international markets, given India’s high dependence on imports.
The Central Government has given permission on Tuesday to rein in the rising prices of edible oils. duty free import 20 lakh tonnes of crude soybean and crude sunflower oil for the current and next financial year. Local prices of edible oils have skyrocketed in recent months. Sunflower oil prices have increased by Rs 39 per liter in the retail markets in the last three months. This has affected the household budget of the urban population more as a greater proportion of them prefer refined oil than the rural parts. local prices of Edible oils vulnerable to changes in international markets Given India’s excessive dependence on imports. In 2019-20, 56% of the domestic edible oil demand was met through imports. However, Russia’s invasion of Ukraine and Indonesia’s policy flip-flops have left India scrambling for alternatives.
favorite oil
The chart shows the type of oil used as part of the total edible oil consumed in rural and urban India. In urban areas, refined oils, including sunflower and soybean oils, were widely consumed (47%). On the other hand, according to the NSS report on household consumption of various goods and services (2011-12), mustard oil was mostly given preference (45.1%) in rural areas. Hover over the chart to find the exact figure
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climbing up
The chart shows the absolute change (in ₹) in average edible oil prices across eight major centres. For example, on May 24, 2022, the price of one liter of groundnut oil was ₹199, which was ₹67 more than three years ago. Sunflower and soybean oil prices have seen the biggest jump in the last five years. Sunflower oil price sees rise by ₹39 in last three months
Sunflower and soybean oil prices have seen the biggest jump in the last five years. Sunflower oil price sees rise by ₹39 in last three months
import dependency
The chart shows India’s dependence on domestic sources and imports of edible oils over the last 10 years. Most of India’s edible oil demands have been met through imports. This high dependence on imports to meet domestic demand makes local prices more susceptible to fluctuations in international markets.
external factors
The chart shows the countries from which India imported vegetable oil in 2021-22. India, the largest importer of edible oils, sources sunflower oil from Russia and Ukraine, palm oil from Malaysia and Indonesia, and soybean oil from Argentina and Brazil. However, with Russia’s invasion of Ukraine, the supply of sunflower oil has been affected. Also, several policy flip-flops by Indonesia along with labor shortage in Malaysia have affected palm oil imports.
*Delhi, Lucknow, Ahmedabad, Mumbai, Kolkata, Bengaluru, Chennai and Hyderabad
Source: FCA, MoSPI, CMIE
Read also: What will the proposed large-scale cultivation of palm oil mean for India’s ecology and economy?